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What Happened When Marissa Mayer Tried to Be Steve Jobs (nytimes.com)
329 points by r0h1n 1069 days ago | hide | past | web | 276 comments | favorite

" Every Monday at 3 p.m. Pacific, she asked her direct reports to gather for a three-hour meeting. Mayer demanded all of her staff across the world join the call, so executives from New York, where it was 6 p.m., and Europe, where it was 11 p.m. or later, would dial in, too. Invariably, Mayer herself would be at least 45 minutes late; some calls were so delayed that Yahoo executives in Europe couldn’t hang up till after 3 a.m."

This is completely unacceptable behavior from anyone aspiring to be an actual leader.

It seems there's a pattern in how she sees other people.

* Trying to design the Yahoo logo herself in a weekend (how hard can it be?)

* Reading a children's book to a room full of employees, to stunned silence

* Disallowing remote employees but building a nursery for her child + nanny. (Do other people get Yahoo! daycare too?)

* Requiring extensive credentials for other people [Gwyneth Paltrow better have a degree!] but not bothering with background reference checks for people she wanted (Henrique de Castro, who cost Yahoo over $100M for a year's worth of shoddy work).

Believe it or not, Jobs had empathy for what the user truly needed, which gave him a killer sense of taste. I feel that's lacking here.

"Believe it or not, Jobs had empathy for what the user truly needed, which gave him a killer sense of taste. I feel that's lacking here."

Yes. It's often said that Steve Jobs was an asshole, but that he was an asshole for the right reasons. He was the guy in the room who cared more than anyone else. He wanted everyone else to give as much of a shit as he did, even when it came to seemingly tiny details.

I don't mean to paint a rosy, revisionist, hagiographic coat over his entire legacy, because plenty of his actions burned people in horrible ways. But when he was being micromanager-in-chief, he was usually doing it for a reason.

Dude straight up stole money from the guy who made his life possible (Steve Wosniak). Tell me the right reason for that?

As I said, "plenty of his actions burned people in horrible ways." There is no excuse for that, nor did I suggest there was. I made a pretty decent effort in the second paragraph to caveat what I'd said in the first. Steve Jobs was no saint, and he certainly doesn't get a pass for how he treated Woz (and many, many others).

He obviously wanted the Woz to care about money as much as he did. You see his generosity of spirit now?

I admire Jobs for his drive and his vision and his ability to get the best work out of amazing folks but his methods were often terribly inhuman when you really look at them.

He was the idea guy.

And we all know here how much an idea is worth.

In Apple's case - about $200BN or more. Anyone could build an iPhone. The proliferation of other platforms (Android, Windows, Ubuntu, ...) proves it. However, nobody but Steve was thinking out of the box at that time. It was just an idea (with a brilliant execution, admittedly).

I give more credit to Jonathan Ive on restoring Apple's place in the industry than Jobs.

First touchscreen phone was the LG Prada, not the iPhone, fyi.

Modern design with multitouch and capacitive screen, perhaps. First touchscreen phone was the IBM Simon in the mid-90s, and my Kyocera 6035 was one of many Palm/phone hybrids that predated LG by years. There were also Symbian and Windows Mobile PDA/phones.

And it was an amazing phone executed so well that they couldn't keep it on the shelves. /s

Seriously. Are you that dense?

Are you? Where was the thinking outside the box exactly?

There are no prizes for doing it first time. But there are prizes for doing it correctly.

(Also with a disclaimer that Steve was no saint)

Wozniak was happy to tinker and "just be an engineer at HP". Jobs pushed him to create something that could be marketed and made Woz rich.

What? He made the apple I by himself with no prodding from Steve Jobs. He was showing other people how they could make their own, and Steve convinced him to sell it. Jobs may have made him rich, I don't know how that absolves him of being an amoral thief when they weren't. I don't know that making Wozniak rich really made him any happier anyway.

You complained about Jobs stealing money from Woz. It's true, and it was a slimy move. I'm simply pointing out that the thousands of dollars stolen were monetarily ameliorated by the wealth created by Apple Computer.

And Apple computer wouldn't have happened without Jobs. Get past your hatred of the man as a person -- he was a driving force and made shit happen. Art != Artist.

>Believe it or not, Jobs had empathy for what the user truly needed, which gave him a killer sense of taste. I feel that's lacking here.

It seems that Marissa's feeling was that if her users don't already like the exact same things that she likes(as a millionaire living in a fantasy world), then they should learn to start liking them.

Yes, which stems from vanity/narcissism: "I have exquisite taste, and people want to be me (a millionaire I-can-have-it-all mom/career woman), so everything must reflect my personal aesthetic."

Contrast with her hero Jobs.

It works for plenty of people. That's why professional celebrities like Kim Kardashian can become successful "fashion designers" based on their fame alone. The only caveat is that you do actually have to have good taste to be successful.

Unlike fragrances and clothing, nobody (very few?) chooses their email app based on a personality. The celebrity link is just too vague; it isn't "Marissa Mayer's Yahoo!", it's just Yahoo!. Even if it was, millions more people look up to Kim K or Paris H.

Also, the investment is way too high to be celeb-driven. It's easy to buy a perfume or a purse or suit or shoes because you like the link to $CELEB. But switching email providers or default search engine? Never happening.

I would disagree with your conclusion there.

Celebrities with fashion labels or fragrance lines don't design anything, some company that already does those things just licenses their name

Victoria Beckham is one exception to this

For example, they better like eating cake instead?

that is what worked for jobs, like to admit it or not.

he failed most products. he got a few right. he had lots of cash to burn until he got it right. He cursed anyone who wanted a tablet when he wanted the iphone.

meyer is doing the same. just didn't have the luck jobs had yet.

> Believe it or not, Jobs had empathy for what the user truly needed, which gave him a killer sense of taste. I feel that's lacking here.

The word empathy to describe Steve Jobs is not the word I would use at all. Maybe "in tune"?

I would go with "lucky guess."

While I'm not a fan of Steve Jobs on account of him being a dick, I think he was right too often to just call it a 'lucky guess'. OSX, the MacBook, the iPod, the iPhone, and the iPad were all hugely successful. I don't think luck can get you that far.

> I think he was right too often to just call it a 'lucky guess'

Why not? With enough different people flipping coins there'll be somebody gets a hundred heads in a row.

Except it wasn't really a case of coin flipping.

Flipping coins suggests everybody is playing the same game with roughly equal odds.

So what is the game here? Releasing new consumer products randomly and hoping they become popular?

When Apple really broke out, PC and electronics manufacturers were still competing with one another based on spec sheets (MHz, RAM, GB, benchmarks, etc. -- whoever has more wins).

Apple went in a different direction, putting more effort into product design and user experience and marketing than its competitors. So it wasn't really a case of coin-flipping, because Apple started playing an entirely different game.

Or perhaps the coin flipping is at a higher level, e.g. trying different broad strategies to get ahead (like putting greater emphasis on design/UX)? Again, nobody else was really trying new strategies, everyone was playing the specs sheet arms race. So, in this case, there weren't enough people flipping coins to invoke the metaphor.

And let's not forget all of the work he put into tilting the odds in favor of success- such as convincing the music industry to change their business model. To say he had some sort of special genius for aesthetics isn't really fair- he also was very strategic. That may be the part the Ms. Mayer hasn't caught up to yet.

.5 ^ 100 is 7e-31. If everyone in the world did nothing but flip coins all day long, how many years before you would expect to see 100 heads in a row?

Generally speaking, I don't admire Jobs all that much. But comparing SJ to MM is really closer to an April's fool joke.

The problem is that she is not a founder but behaves like one.

Its unacceptable behavior from anyone even expecting to continue being an employee. Those meetings, when couple by her habitual tendency to miss meetings with people that weren't even a part of her company are ridiculous. It boggles my mind how someone so irresponsible, self-centered, and inconsiderate has managed to get where she's at.

Is this the most expensive cargo cult in history? Yahoo board deciding on new CEO: "Steve Jobs was rude and inconsiderate, Marissa is rude and inconsiderate...."

and nobody said "Steve Jobs built a bunch of revolutionary/innovative/transformative things from scratch - Apple, Next, Pixar, iPod, iPhone, and Marissa was an employee who made a successful way up to mid-level executive at a Big Co". These people couldn't be more different :).

And by the way, Marissa is rude and inconsiderate only to the people under her while she has been very polite and considerate to her superiors where is Steve Jobs has never had superiors :)

>Marissa is rude and inconsiderate only to the people under her while she has been very polite and considerate to her superiors

Did you read the article? She routinely left people hanging that were often(in terms of social hierarchy) her equals or betters.

>Steve Jobs has never had superiors :)

Steve Jobs had superiors, he just pretended that he didn't. While things clearly worked out for him in the end, this attitude resulted in some hard lessons at different points in his career.

>Did you read the article? She routinely left people hanging that were often(in terms of social hierarchy) her equals or betters.

i don't think she considered them "higher" or even equals. I'd like to see her letting the Yahoo board hanging dry for an hour next time they convene to discuss the results :)

>i don't think she considered them "higher" or even equals.

She might not consider them to be important, but some of them most certainly were by any objective standard. An executive from one of the largest advertising agencies in the world publicly asked her why she never returns his emails. He was exactly the type of person that the CEO of Yahoo should consider important. If she doesn't someone should show her the fucking door.

I will give you Apple and Next, but not Pixar, iPod, and iPhone.

I agree that Jobs doesn't deserve credit for Pixar's success. He acquired them for technology that he intended to use elsewhere, and he supposedly looked at them like a burden until all of a sudden Toy Story blew up.

No. You are wrong. He was extremely proud of PIXAR and mostly the people. It is true that he is unsure as to how PIXAR will turn out, he never doubted the talent. Ed Catmull in his autobiography - Creativity Inc. explains Jobs in detail.

I'm reading Catmull's book now, which is not an autobiography by the way. From reading that and other sources, I would agree that he was proud of the people but not the company. Jobs looked to unload Pixar more than once and didn't fully support the idea of it being an entertainment company until it was obvious that Toy Story was going to be a hit.

Regardless, I'll never give Jobs more credit on the success of Pixar than Catmull, Lasseter, and others who are the true sources of success for that company.

The external piece is the surprising one. I've seen successful executives ignore the internals of their company in order to fully ingratiate themselves with customers. It's frustrating, but brings in revenue. It sounds like she's just completely overwhelmed.

> It boggles my mind how someone so irresponsible, self-centered, and inconsiderate has managed to get where she's at.

Despite her other failings, she is obviously very smart. People talking about the early life at Google all agree on that.

Good thing the smart are incorruptible by power. Oh, wait.

You just made Ayn Rand roll in her grave.

Which was an action she freely chose to do, of course.

Don't forget Plato

That a titan of human thought could in any way, shape or form be associated with that poor PTSD victim from Russia - is just proof that we indeed live in an imperfect sublunar realm, deprived of all genuine existence, mere shadows on the wall of the real, ideal forms up there.

In a manner of speaking. :)

I'm confused. :)

What does what I said have to do with Ayn Rand?

I'm also curious about how Ayn Rand and Plato were thrown into the same group. I remember well that Plato went on and on about his Utopia of the State controlling the lives of everyone, people going to college until they're 32 and so on. Those two are pretty much opposites. And Plato was a titan of human thought? He misunderstood everything Socrates was about and it took us Aristotle being born to somewhat set us back on track. Maybe whoever said that is really into geometry of solids.

Anyone care to throw me a bone? What did I miss? Why did I make Ayn Rand roll in her grave?

Plato's utopia would be ruled by a philosopher-king, in contrast to the Athenian democracy in which he lived. This could be considered an example of the idea that "the smart aren't corruptible".

I can't speak for the other poster but I imagine that Rand's heroes would not be corruptible, for example, refusing government subsidies on moral grounds or sacrificing their artistic vision for commercial reasons

From what I remember of Atlas Shrugged, Rand only creates fantasy worlds where bad guys can be tempted. Good guys are simply never put into the situation, because whatever law or principle they might break has already been recast as intrinsically evil.

> It was said that Nat Taggart had staked his life on his railroad many times; but once, he staked more than his life. Desperate for funds, with the construction of his line suspended, he threw down three flights of stairs a distinguished gentleman who offered him a loan from the government.

Exactly my point. Nat Taggart is being shown as incorruptible, within the standards of "corruption" that the author has placed into her Mary-Sue-Universe.

He doesn't just say "no", he throws the guy down three flights of stairs!

>he throws the guy down three flights of stairs!

And for some reason she seems to think that the attempted murder of a liberal is an honorable act.

And for some reason liberals think that the attempted extortion of money from people within a certain radius of a certain situation is an honorable act.

I'd throw a bone, but you look like you'd need a herd of cows instead.

This is completely unacceptable behavior from anyone aspiring to be an actual leader.

Seems more appropriate for crisis mode than ongoing management. In general there seems to be a modus operandi of "My time is more valuable than yours, so you wait." While this may be true, it's a poor way to manage creatives.

It's a poor way to manage anyone, period, and an even poorer way to deal with people outside of the company. An anti-pattern if I ever saw one.

> This is completely unacceptable behavior from anyone aspiring to be an actual leader.

Someone at her level should not be aspiring to be a leader, but should be a leader from the start.

Depends on the reasons why she was late and if they were legitimate or not.

"Depends on the reasons why she was late and if they were legitimate or not."

It really depends on how "invariably" she was late. If she was late almost all the time, and by 45 minutes or more each time, then it's patently irresponsible. She should have set a different time for the meeting every week. Or she should have blocked out her schedule to make the time. On the other hand, if she was late maybe 25% of the time, that's a different story. The CEO of a huge corporation is going to be late to a lot of meetings. It's the nature of the job. There isn't enough time in the working day for all the people, situations, and projects she needs to handle.

Having worked every now and then with C-level executives at huge companies, some much bigger than Yahoo, I can tell you that they're often late to meetings. Staff meetings especially, because staff meetings are standing, and standing meetings usually lose in an ad-hoc triage battle against spur-of-the-moment meetings. Almost axiomatically, anyone or anything important enough to hijack a CEO's time is going to be important enough to win the priority battle against a standing staff meeting.

All of that said, "invariably" needs to be defined here. Especially given the circumstances, i.e., requiring all direct reports in various timezones to be there every Monday on Mayer's clock. If it was, indeed, "invariable" -- as in, she was always at least 45 minutes late -- then she should have found a new time for the meeting. That's completely unacceptable.

Having meetings at a time that suits you with people that may be considering going to bed, and actually are outside any kind of office hours whatsoever should be unacceptable behaviour of any leader.

I agree completely, but to me, this speaks to an organizational design issue as much as a scheduling issue. If you have direct reports in N different timezones, and there's almost no functional overlap between some of those timezones and your own, then why are they your direct reports? You are fundamentally incapable of directly managing them, and they are incapable of directly reporting to you. Put a better org structure in place, and shed whatever reasons you have for insisting on those people's directness -- be they playing to people's vanity, an overreaching desire to be "flat," or something else entirely.

(Obviously, this is easier said than done. At that level, the politics of moving around direct-reporting lines is going to be a nightmare.)

But I do agree. The complexity of scheduling increases dramatically as the number of timezones N increases. You try the best you can to schedule a standing meeting that accommodates everyone. Someone's going to have to make a sacrifice in convenience. As the leader, you should try to find a time that makes a sacrifice on your end, provided it's not too ridiculous.

At the very least, start the standing meeting at 7-8 am California time. That's the decent way to run a global organization from the West Coast.

Yeah, it would have been better if the article went into detail about its use of the term "invariably". I don't know if the author was just loosely using the term or if he actually meant that she was habitually late.

Still, I don't see that as "unacceptable" behaviour. It's something to be frowned upon for sure and it would be great if she could be punctual all the time, but being the CEO of an incredibly large and diverse organisation, she could be forgiven if she was late due to some other meeting or work-related issues.

Also, remember she's getting only about 4 hours of sleep everyday and practically lives at her workplace, so I doubt she's being late on purpose.

I'd suggest it's practically impossible for anyone to get by on 4 hours sleep a day and remain even remotely sane.

Sleep deprivation is classed as torture. Even if you're a Type A personality, 4 hours is not enough to avoid issues with basic cognitive competence (at best) and general mental health (at worst).

See e.g.


There's been a really unfortunate (and pseudoscientific) meme going around in the tech world these past few years, about the supposed abilities of "extremely high-performing people" to make do on little to no sleep. It's possible that Mayer herself buys into this myth, or at least that she cultivates it as part of her personal brand.

While it's true that not everyone requires the exact, same sleep schedule or regimen, there is no human on Earth who can successfully go years and years on 4 hours or less every night. You'll pay that debt eventually, with interest. Maybe not today, and maybe not tomorrow, and maybe 20 years from now. But you'll pay it back. Often in the form of a heart attack, a stroke, or brain damage.

Was anyone claiming that she remains even remotely sane?

Tell that to my manager :P

I'm with you on all of this. I use the term "unacceptable" as a conditional. If "invariably" actually means close to 100% of the time, then I think it's unacceptable. And if not unacceptable, then certainly inconsiderate.

I am using conditional logic here because, like you, I have no idea what "invariably" really means here. Writers have a tendency to throw around words that sound good, without always considering the true extent of their meaning. As a sometime-writer, I suffer from this problem myself. "Invariably" is a tall claim, which is why I'd like to see the evidence for it before rushing to conclusive judgment.

Everyone is late once in a while. Some executives are late pretty often. But every single one of them that is worth anything at all will at least send a text or a phone call letting you know they aren't going to make it.

Unless someone is on their way to the hospital, there really isn't a reason to leave someone hanging.

No job is worth that. Also consider the performance and morale damage from being forced to deal with that at the start of every week. Thanks but no thanks.

This anecdote is almost too perfectly aligned with the narrative to be true:

> Reared in Google’s data-obsessed culture, Mayer tended to require countless tests about user preferences before making an important product decision. But when it came to media strategy, she seemed perfectly comfortable going with her gut. As a teenager in Wisconsin, she grew up sneaking into the living room to watch “Saturday Night Live” and occasionally recited sketches during meetings; in April 2013, Yahoo paid an estimated $10 million per year for the “S.N.L.” archives. Even though the actress Gwyneth Paltrow had created a best-selling cookbook and popular lifestyle blog, Mayer, who habitually asked deputies where they attended college, balked at hiring her as a contributing editor for Yahoo Food. According to one executive, Mayer disapproved of the fact that Paltrow did not graduate college.

Well, I can think of one obvious difference between Mayer and Jobs...

> Mayer disapproved of the fact that Paltrow did not graduate college.

Wow , sorry but wow. Paltrow is famous,more famous than Mayer will ever be.If this thing is true,it tells a bit about her personality.

In business,you want to associate with famous people that can drive their audience to your product.Does it matter they graduated or not?frankly?

Presumably they wanted her to actually do the job, not just be the face of the job, so her skills beyond "being famous" would of course matter, like hiring anybody else.

Of course that doesn't mean I agree with assuming that no qualifications means can't do the job, but that's unrelated to her being a celebrity (and indeed a commonly debated question with two big groups of people on both sides).

Given that a lot of web sales/pageviews has mainly to do with branding (i.e. the more famous you are, the more pageviews you get, making you even more famous), Paltrow's name (and the brand that it carries) is her doing her job.

It's her doing some of the job. Maybe it's big enough that if the rest of her time was spent sleeping it would still be worth hiring her. Maybe she'd be amazing at the rest of the job, regardless of qualifications. But if you're looking to hire someone to actually run something then being famous isn't enough on its own.

>But if you're looking to hire someone to actually run something then being famous isn't enough on its own.

This is what I was touching on downthread and I guess wasn't entirely clear: a contributing editor doesn't run anything.

They don't copy-edit other writers' work. They don't manage anyone. They don't touch anything related to the business backend.

It's a prestige title given to writers that generate an audience. That's it.

It's not unusual for content that appears to be by famous names to be ghost written and (sometimes) approved by the famous name.

Or their agent.

So here was absolutely no reason not to hire Paltrow - even if she can't write her way out of a YouTube comments section.

Celebrity culture sells. It's kind of disappointing, but empirically it's what a lot of people want and will pay money for.

So is your (and others) assumption that Mayer was literally making a decision based on no logic at all?

The reason I made my point was that judging someone based on not having a degree can be considered foolish, judging someone on not having a degree where a degree couldn't even be related isn't foolish it's just nonsense - so I gave Mayer the benefit of the doubt. But maybe I was wrong to?

That's exactly why that anecdote has gotten an incredulous reaction.

If it's accurate that the position was for a contributing editor for a food blog, caring about a degree is completely nonsensical.

It's certainly possible that the story is inaccurate, but it seems to have been included in the article as an intentional example of bizarre decision making.

"balked at hiring her as a contributing editor for Yahoo Food"

Paltrow wasn't going to run anything, contributing editors for the role she was being brought in for submit content and bring in readers based on their popularity, which she has a solid track record on. There isn't any "rest of the job" besides that.

Example of someone who doesn't do all of their own work, Martha Stewart. Sure she does some work, but she has a very talented assortment of professionals that help her blog and create content.

I don't think Martha has the time to put together slideshows like this one.


Appropriately, Martha Stewart has occasionally posted hilariously awful photos of her cooking, that she presumably did take herself. Don't have time to dig up the URLs, but it's easily found.

She created a best-selling cookbook. How is this not doing the job?

There was no running anything involved. The position in question was "contributing editor". That is an inflated title that means "part time blogger".

>Gwyneth Paltrow had created a best-selling cookbook and popular lifestyle blog

A contributing editor job is essentially a writing position. That strongly indicates that she could do the job.

I'm not arguing that she could (or couldn't), just that whether she could do the job was more than just "she's famous". Personally I fall in the camp of people who will judge on experience more than degrees, clearly Meyer is on the other side.

That's kind of the thing, though. Contributing editors are often brought in because of their notoriety.

There's valuing a particular quality in an employee, and then there's being completely misguided in weighting that quality.

Plenty of people could write as well as David Pogue, Nate Silver, Ezra Klein, etc., but the expectation is that those writers will bring the audience.

They get seven figure salaries not because they can write articles really well, but that they can bring an audience wherever they go and create revenue worth what they're getting paid

Paltrow is 42.

Basing hiring decisions for middle aged persons on their college record is incredibly foolish.

Mayer is 39. She probably doesn't think she's middle-aged (even if she is, and if she is, I don't want to hear about it either ;> ).

>Presumably they wanted her to actually do the job, not just be the face of the job, so her skills beyond "being famous" would of course matter, like hiring anybody else.

They were thinking about having her write/create content for yahoo. She has already successfully produced content for a long time on her blog. She was completely qualified for the job, but Mayer found a bullshit excuse not to hire her because she simply doesn't like Paltrow.

Paltrow already runs a web/email publication (Goop: http://goop.com/) that's pretty successful. That's why Yahoo was interested in her. Her celebrity status helps, I'm sure, but it's not like they were hiring a clueless airhead to be the public face put on someone else's work.

corin_ : Companies don't hire famous people to "do the job". They hire them because they are famous. E.g. Alicia Keys at Blackberry, Rihanna at Puma, Will.I.Am at Intel. So, university degree is indeed utterly irrelevant.

Normally they do, but the fact that Mayer cared about her qualifications surely means it was about more than just the famous face.

Generally speaking disqualifying someone for not having a degree is (in my opinion, and many others but plenty disagree too) foolish, but if you're only considering her for being famous then nobody would even bother finding out if she had a degree.

edit: By the way, if you want to reply to a comment and don't see the reply link (presume that happened to you? ignore me if not), click "link" for that comment and take it from there

Thanks for the reply tip!

Is Marissa Mayer on the way out of Yahoo? This article which lists all her faults, summary of mistakes suggest a sort of open warning. Mainstream media like New York Times won't list mistakes of acting CEO because of the fear of backlash unless something is happening in the background like merger/replacement or some influential person(s) are actively leaking out his/her disappointment/frustrations.

Some how, I am getting impressions of HP's former CEO Carly Florina, while reading this article. Hope it won't end like that.

It appears Marissa Mayer is in hurry to prove something but without proper strategy. She is sort of mixing Apple's Steve Jobs way, netflix way, Google's data obsessive ways to somehow create some recipe for success.

I feel she has to cool down and make some original recipe rather than mixing from various other companies.Wall street, Yahoo Board and investors need to be told that turnaround may take at least five years and there should be no hurry in between just like HP's current CEO Meg Whitman did, irrespective of consequences. This can give her peace of mind and helps in creating a better strategy. It appears, she wants to rush but do not know where to and meanwhile falling. She has to slow down and rethink.

Also, this article can be condensed. It lists about yahoo from its start to previous CEO's, her hiring ...etc. Yahoo's past before Mayer may be irrelevant in the context of this article.If needed, URL to past article may be sufficient.

If the article got the overall picture of the financials right, then, yes, she's on her way out.

The run up to the Alibaba IPO was her window of opportunity to create new growth businesses within Yahoo. Since apparently those initiatives have failed to yield significant revenue or profit growth, she's done.

I think if those initiatives had paid off, we wouldn't be reading about her personal flaws and missteps, but about her managerial brilliance.

I was also disappointed in her comparing herself to Jobs taking 5 years to launch iPod. Yes, that was a home run for Apple, but the first thing Jobs did was shore up the existing Mac business and get it growing again, providing the needed stability to launch new initiatives.

Again, assuming the article has the gist of the story correct, she largely ignored the parts of Yahoo producing much of the current revenue to focus on new initiatives.

In general, comparing yourself to Steve Jobs is probably a mistake for any executive. It's like a rookie NBA player comparing himself to Michael Jordan. You're almost guaranteed to come off badly in the comparison.

I'm going out on a limb here, but: Mayer poached Pogue from the NYTimes. There may be hard feelings against Mayer for recruiting him or against Pogue for jumping ship?

You're right on several points.

- It could very well be a strategic leak.

- It's brazen tone suggests that she's very weak.

- It's much too long an article.

The one thing I'd differ is she did appear to have a strategy, it just didn't work. (Upscale media, original content, mobile emphasis, more sales, etc...)

I don't think she gets 5 years to execute on it.

My first thought:

"Is this a PR leak to prepare us for new CEO"

or a hostile takeover

I didn't interpret the article as just listing Mayer's faults.

It also says decline is inevitable for all big companies, and the process is accelerated in tech companies (like everything else in their lifecycle). Turnarounds are rare, and no choice of CEO would have made a difference for Yahoo.

[Mayer] highlighted various signs of promise. ... Display advertising revenue was down 6 percent, but the number of ads sold had actually increased by 24 percent.

Good news, everybody! We're doing more and making less!

Yahoo isn't a products company -- it's a pile of cash with long audience reach. This isn't a bad thing (and indeed was the situation at Apple when Jobs returned), but it does mean that the company has lots of options but no core mission. The danger is that such a company can kill its cows while searching for stars.

It's hard to avoid the conclusion that Mayer has failed to develop any kind of coherent strategy, let alone execution. Instead, she appears to have substituted chaotic action as a metric of progress (new home pages every day! Purple everywhere!), mistaken her hobbies as evidence of expertise (e.g., deciding Yahoo could become a destination for high-end prêt-à-porter fashion consumers), and taken on high-concept strategies without any kind of plan for generating revenue and income (e.g., going deep on content). This doesn't even get to Yahoo's constant overpaying for startups that are inevitably killed by indigestion -- I like to say that VCs operate on the greater fool theory, and right now the greatest fool is Yahoo.

Couple this with what is evidently a tendency to micromanage without attention to detail, a constant reworking of HR aspects without any comprehension of how such changes affected loyal employees, and an almost imperial demeanor -- no surprise that her tenure is already being prepped for postmortems. Mayer's failures have at best led to drift and at worst burned the little remaining daylight left for Yahoo. Were I a major shareholder at the company, I think I'd rather have little Bobby and his nickel in charge than Marissa and her $2.08 billion.

> It's hard to avoid the conclusion that Mayer has failed to develop any kind of coherent strategy, let alone execution.

This has been my impression since she got the gig -- that she doesn't really have a strategy, just a collection of tactics. So she runs around doing stuff and hoping that some of it will improve things.

For all the comparisons to Jobs, this approach shows a key difference, namely that Jobs had a strategy. When he took over Apple the first thing he did was brutally cut down the company's product lines. By the time he was done Apple really only sold four products: consumer and pro Mac, consumer and pro PowerBook. That was the entire Apple product line. This was a strategic decision: cut down to four products and absolutely nail the implementation of those products, rather than trying to have a half-baked product for every possible customer.

Really good point -- I had forgotten Apple's proliferation of incomprehensibly-named Power Macs and how Jobs reduced the line to the bare minimum. And, indeed, part of his strategy was to kill off Apple's actually innovative product, the Newton MessagePad, which had finally hit a solid implementation with the 2000. As much as I loved the Newton, killing it was a sound tactic in pursuit of a sound strategy.

By contrast, think of Jobs at NeXT: he pursued a failing strategy because he was trying to innovate for innovation's sake (trying to build a 3M workstation without a proven market; building a totally-automated, world-class factory without enough orders to keep it operating; obsessing over minutiae like the handrail design at NeXT headquarters). The result was fantastic technology but a company whose promises had to wait for Jobs' return to Apple.

I like to think that Jobs' failure at NeXT was an educational experience for him; however, with Mayer, I'm not sure she can pull off a second act after what I expect to be an unceremonious ouster from Yahoo.

Was NeXT a failure? From Wikipedia it was founded in '86 and got bought in '96 by Apple for $429m plus 1.5m Apple shares for Jobs. I wouldn't mind failing like that.

I'm a bit late in catching up on this, but NeXT really was a commercial failure. It sold a number of its workstations to government agencies (notably CIA) and scientific teams , but in the early '90s exited the h/w business to concentrate on selling NeXTSTEP and, later OpenStep.

The strategy switch was the result of the company's failure to compete with workstation manufacturers like Sun, and the company's rapid drawdown of its cash. By the time NeXT exited the hardware business, they had revenues of about $125m/year, but operating at a loss; Canon, which was already into NeXT to the tune of $100m, floated another $30m plus a $55m line of credit. Jobs was also funding NeXT and his other project, Pixar, out of his own bank account, which left him severely depleted. (Previously, Ross Perot and, later, a consortium of universities had also invested in the company for about $150m combined.)

By cutting the hardware business, developing a mildly popular web server (WebObjects), and selling off assets like the Deer Park HQ, Jobs was able to eke a minor profit out of NeXT, but nothing that would justify the massive valuation investors accepted during its early days. Apple's purchase was indeed partially for its technology -- Apple had played around with a competing OS, Be, for its new OS layer, but ultimately passed -- but also to lure Jobs back.

One of the article's premises is that Apple started to turn around with the iPod; I would argue that it turned around with the iMac.

In addition to the simpler product lines, there's also the design focus into that went into these fewer products, the iMac and iPod becoming iconic designs.

(Time to dust off ye olde account again)

This article, while making good points, is written with a slant: to sell a book.

Broadly speaking, Marissa's big weakness is that she's a tad naive. She thinks too logically, and believes that if she has a system in place, it will be followed in spirit by logically-thinking people like herself. This may have worked in Google, because Google was heavily engineer-focused during its early years; but Yahoo is different: it's a (nearly) 20-year old company, with many people who are lifers. They have honed their skills at survival; and as one middle manager put it to me, "I've seen lots of CEOs; she'll also be gone, but I'll still be here". She can come up with the best laid plans; but the middle management will do what it thinks is in its best interest. And they look out for themselves, always.

One of the major reasons why she embarked on the acquihire spree was to do an end-run around these people. She knows that if she has to count on them, she won't get anything done.

This is also why she initiated the 'stack ranking' process. Her goal was noble: to weed out the underperformers. And yes, they did weed out a fair bit of deadwood. But the elephant in the room went untouched: the middle managers. There is no accountability for them! I've seen people join a manager's team and quit (or switch) within months; by any objective evaluation, he should have been fired a long time ago. And yet he survives, because he's been there a long time and knows how to play the game. I have also seen stellar performers quit because their manager was not willing to go to bat for them in the calibration meetings, so they always ended up with "achieves" (which is average, and forms the bulk (70%) of the ratings).

This article cherry picks mistakes; but who amongst us hasn't made a mistake? The HdC hiring was a big mistake, for sure. But once again: she was being naive, and thought he could deliver, when all he was doing was blowing smoke up her ass. She still can't get her mind wrapped around the smoke-and-mirrors that is sales, which is why Sales is still suffering. She needs a powerful, no-holds-barred Sales head, so she can go back to being a Product person.

People in HN can diss her all they want, but I was at a trade show, and half the outfits (startups) I talked to wanted to be bought out by Yahoo. Money talks; and right now she has gob loads of it that'll give her a lot of rope.


I was at Yahoo briefly (8 months, never again !) and middle management at Yahoo was absolutely the problem. A single SVP had 20 VPs and around a 100 Directors and Senior directors most of whom were lifers and 'career bureaucrats'. Less than 1% would be employable at another tech company.

The status quo at Yahoo before Marissa suits them just fine and they will always find ways to twist any effort from the top to their benefit.

QPRs are a classic example. It was intended to weed out under performers, but as the parent comment pointed out, the middle managers were the under performers. So they just made QPR evaluations into a secret, subjective process which they then used as a club to beat engineers who dared oppose them. Worked out pretty well for them, not so well for Yahoo. Anyone who was worth a damn found a new job pretty quickly.

> Broadly speaking, Marissa's big weakness is that she's a tad naive.

Is naiveté something a CEO (of a massive company) should be given a pass on?

" De Castro would leave the company in January 2014. For about 15 months of work, he would be paid $109 million."

Costly mistakes.

But it happens at that level. You can't seriously expect anyone to go through life mistake-free. Look at Google's mistakes, for instance. How much money have they thrown after Google Glass?

If you hire someone that's a borderline con-man and lose $100 million dollars without making the most basic attempts of vetting him for the position, that's not an honest mistake.

> But the elephant in the room went untouched: the middle managers.

Microsoft occasionally does a "flattening" exercise where they go around and reduce the number of managers that exist.

Put a year moratorium on promotions to manager (sucks, existing managers get way overloaded), then a year later do another stack ranking exercise.

The reason to be bought by Yahoo is for the cash, not to be part of Yahoo. And what are the successes for such acquisitions?


I think most of these dates before Mayer took over however.

I've seen this a lot as well: execs that are so busy re-inventing their business that they don't manage their core operations.

<< Aswath Damodaran, a professor at N.Y.U.'s Stern School of Business, has long argued about the danger of companies that try to return to the growth stage of their life cycle. These technology companies, he said, are run by people afflicted with something he calls the Steve Jobs syndrome. “We have created an incentive structure where C.E.O.s want to be stars,” Damodaran explained. “To be a star, you’ve got to be the next Steve Jobs — somebody who has actually grown a company to be a massive, large-market cap company.” But, he went on, “it’s extremely dangerous at companies when you focus on the exception rather than the rule.” He pointed out that “for every Apple, there are a hundred companies that tried to do what Apple did and fell flat on their faces.” >>

It's probably not a coincidence that Steve Jobs had Tim Cook there to manage core operations, while Steve spent a lot of time focused on reinventing the business.

It awfully sounds like Yahoo is JCPenney of tech. A super-star was brought in to revive the growth in to JCP, Ron Johnson. He tried it too hard and too fast, and almost ruined JCP beyond recovery. "Alibaba" is the one silver-lining that gives Yahoo something to play along, but this just reminds me JCP & Ron Johnson.

I really liked what Ron Johnson tried to do with JCP, and I loved his straightforward pricing (no more of that standard department store mark it up 300% and then perpetually have it on 50% off discount). Guess it ended up being a little bit too idealistic of a strategy though and JCP customers weren't able to see that it really benefited them. A shame it didn't work out.

I would love to be able to pop open a web page, login, and click off some great clothes at consistently great prices and never a mention of "sale", "discount", "promotion", "free", or "almost out of stock" and just be done.

For kids in particular who are outgrowing their entire wardrobe every 6-12 months, streamlining the process would be incredibly useful.

But I think you need one more thing -- you need branded product lines which set expectations on the product and consistently back them up. I think JCP, without the draw of a big sale, didn't have enough draw left over. No one showed up to ever see all those consistently great prices.

This is only tangentially related, but I was surprised that Apple, Amazon, Facebook, and Google were considered the "big four" technology companies. The comparisons to Amazon, Facebook, and Google make sense in that those three (and Yahoo) are all internet companies, but I don't see how Apple fits into this paradigm. The author focuses on Apple's revenues from hardware sales, which has almost nothing to do with any of Yahoo's business.

I also found it interesting that Microsoft wasn't mentioned once in the article, considering the fact that it makes much more sense to draw parallels between two software giants trying to turn themselves around (not to mention the fact that Yahoo search is run on Bing). Surely Microsoft is still considered a "Big tech" company?

>Surely Microsoft is still considered a "Big tech" company?

MS market cap: 371.84B

Yeah, I'd say they're big and I'm not sure if they're trying to "turn themselves around." They're making money hand over fist, mostly from the enterprise end of things and Windows/Office licensing. Of course, they are doing poorly in the mobile arena, but that doesn't mean they're in financial straits.

They are absolutely trying to turn themselves around. They have burnt a ton of bridges and lost a lot of battles.

Hardly in financial straits, but becoming strategically irrelevant to the future of computing (like IBM -- huge, and ignorable).

I really really do not think that IBM is "becoming strategically irrelevant to the future of computing". Maybe the IBM of the early 1990s, but not the IBM of the mid 2010's. Watson and its related technologies are practically synonymous with the future of computing, in my mind.

Good call, I'd forgotten Watson -- but I think you caught the idea of what a big and ignorable company could be.

Apple's software & services revenues are pretty significant, its gross revenue from iTunes Store, App Store, etc comes to $7+ billion per quarter:


Presumably Yahoo aspires to reach the level of [Apple, Amazon, Facebook, and Google], Microsoft is in the process of a major pivot so it probably wasn't considered an aspirational target (even if they do make massive amounts of money)

It's true that Apple has nothing like the direct revenue streams of Facebook or Google coming from the web via advertising (but Amazon isn't in the same business either).

What I think the point is that all four companies operate very large online services. There's even significant overlap on a lot of key products: maps, messaging, email.

What are you talking about? Last time I checked Apple was the corp with the deepest cash pockets from all the corps mentioned.

Probably has more to do with the story tie in than pure equivalency. Hard to run with the headline "What Happened When Marissa Mayer Tried to Be Steve Jobs" without Apple being part of the story...

yeah, the big 4 are Amazon, Facebook, Google and Microsoft.

Not mentioned in that list; Microsoft.

Yes, it is strange. What about Intel, Microsoft, Oracle, TI, Cisco, IBM, HP, Dell and others?

Apple has always been a bit of a darling of the media for some reason or other.

My suspicion is that Apple got a foot in the door with the intro of the Mac. And they have stayed there ever since via something similar to the old "nobody was ever fired for buying an IBM".

Around where i live i can almost tell who is taking media studies based on the kind of computer they pull out of the bag. If it is a Mac, they are doing media.

And thanks to that, the media people pay closer attention to Apple than they do most other tech companies.

And with media studies broadening to cover the web, i keep seeing more people defaulting to Mac as the dev platform for web.

> Apple has always been a bit of a darling of the media for some reason or other.

They were the punching bag during most of the nineties. The company was in bad state (from 1993 to 1997 there were four different CEOs), their offerings too expensive, and with too few applications running on them and no clear strategy for the company. They were a relevant punching bag primarily because they were the only Non-Microsoft computer that people had ever heard of; and a lot of schools had Apple ][e's (a few macs, but many more Apple ][e's). The main place where Macs were managing to maintain some marketshare was in, as you have noticed, media and publishing. For a while, Photoshop was the primary killer app for the macs, and is still (last I checked) the de facto standard for it's domain.

Their image drastically improved when Jobs came back. He launched the "Think Different Campaign", the iMac's with the hockey puck mice (also, he got an injection of $150 million from Microsoft and a commitment from them to build the Internet Explorer for the Mac), and finally delivered a modern operating system (Mac Fans were in denial about how bad the OS was prior to X). Jobs provided a compelling narrative that the media loved telling, of a man banished from the company he founded, and returning to save it from destruction. Also, the perception was that he'd also have to take on Microsoft, so he had the whole "David and Goliath" thing going for him as well. The popularity of this story is effectively why something like "Pirates of Silicon Valley" got made.

I'm not entirely sure why mac laptops have gotten such traction in the dev community; but it's not because media studies is broadening to cover the web.

>I'm not entirely sure why mac laptops have gotten such traction in the dev community

Macs have been since Jobs return as much of a status symbol as a productive device.

Combine that with the fact that OSX is a modern Unix, has BASH, and can run most GNU/Linux targeted software with only a C compiler.

THEN you have actually have competitively powered hardware running under the hood (i7 + 8GB of ram + 5+ hours of battery).

You actually get an all around fairly solid development machine that also acts as a socio-economic status symbol. Jobs did in fact know what he was doing.

>I'm not entirely sure why mac laptops have gotten such traction in the dev community

Makes sense to me - it's a Unix with big-company support. Up until the last couple of years, running Linux on a laptop was a nightmare of compatibility and driver issues, and certainly not something most (i.e. non-big-4) companies would want to take on for a corporate fleet.

People keep saying that Linux is no longer a nightmare, but it often still can be if you have to use an existing, non-custom-built machine that was made for Windows. And if you're going to buy a new machine and have cash to splash, well, the Mac has no hardware issues running OS X.

In all practical terms if the computer is not custom build for Linux or OSX, it is by default custom built for Windows (and a specific version of Windows at that).

I switched to a Mac laptop late in the PowerBook series. Before switching, I developed mostly on Unix (AIX, Solaris, and HP-UX) and appreciated that I could drop into a terminal when necessary and use a solid shell scripting language. Windows' DOS batch language just doesn't do it for me.

Windows' memory management was horrible at the time. I had to reboot a minimum of daily or my laptop ground to a halt. OSX hummed along for months between reboots.

I hate system administration on my own laptop. In the 30 minutes I have to code a personal project daily, I don't want to screw with drivers, updates, hardware, etc. I just want to code the next module in my project. The Linux distros at the time seemed to require more hands-on maintenance.

Over time other factors have become important. The same laptop I use for coding is the one I use to download music, store memorable photos, etc. The apps that come with OSX may not be "best of breed" - maybe they are, I'm not qualified to say - but they are more than good enough for my needs.

Despite great advances in Linux distros and the call to F# and LINQ on Windows, I'm Apple's customer to lose not others' customer to win.

I worry that this you may be neglecting base rate. I hardly even _know_ anyone who doesn't have a Mac laptop, regardless of what they do. I'm not sure the "non-Mac user" is even a coherent natural class anymore.

I like this part :

> " Mayer also favored a system of quarterly performance reviews, or Q.P.R.s, that required every Yahoo employee, on every team, be ranked from 1 to 5. The system was meant to encourage hard work and weed out underperformers, but it soon produced the exact opposite. Because only so many 4s and 5s could be allotted, talented people no longer wanted to work together; "

Can somebody talk about his experience in the same conditions?

Fixed-distribution stack ranking is bad for precisely the reason pointed out -- because of differences between team missions, personnel, and capabilities, the values are basically scale-free when compared across an organization. It also means that employees, particularly at the upper management level, are graded relative to factors that are exogenous to their performance (if you do a great job running a declining or static business unit, you're likely to take a hit relative to an executive doing a worse job in a better sector).

Rank-and-yank arguably worked well at GE because Welch was dealing with a large, unwieldy, and poor-performing conglomerate that had a lot of room for workforce reduction. But as the company got leaner and more effective, it got rid of the practice, and it's unclear why tech companies -- which one assumes haven't had time to get lazy and complacent -- jumped on the bandwagon.

In fact, theoretically, if you're constantly cutting the bottom 10-20% of performers, and the quality distribution of new hires remains constant, at some point you should have pulled up the overall quality of the organization. The fact that you can't create a perfect organization by constantly cutting the lowest quantiles suggests that either something's wrong with the ranking systems used (which there is!), or that the practice has deleterious effects on retention, behavior, and morale (which it does!).

Practically, this means that, as a manager, you get really good at piling up deadwood until the order comes down to swing the axe -- far easier to keep a few window-seat employees around to satisfy the Layoff Gods than to go to war every time you do your QPRs. You might also coordinate with lateral colleagues to move good employees around so you can keep them in the game.

The craziness is in the application. Across an entire company, sure, a normal distribution curve is probably reasonable to expect. But they make you take that curve and apply it at the team level, which makes no sense.

Look up MiniMsft's blog -- he talked a lot about stack/ranking at Microsoft and the effect it had on the business. It wasn't a positive, let's just say that.

Yeah, I learned, probably from it, that that's exactly one of the results from this sort of stack ranking. At the extreme, it's almost impossible to assemble a "dream team", tiger team or whatever because absent sustained political cover, some of them will have to be assigned a 1 or 2, and be shown the door or otherwise have their career zapped.

Raytheon has a four-bin(Far exceeds, Exceeds, Meets, and needs Improvement) ranking system that, while officially not a stack-ranking system, unofficially is because managers are under significant pressure to have their sections roughly meet corporate's expected rating distribution. The system is not a total clusterfuck because the "I" category, which gets you put on a Performance Improvement Plan, is allowed to have nobody assigned. A manager still needs to respect the E and F targets, though, so awesome sections end up screwing people over and mediocre sections end up rewarding people who don't deserve it.

How can someone far exceed expectations more than once or twice. Aren't the managers just bad at judging expectations at that point?

In a political organization there's no problem with repeated "we were frat buddies in college", "we have fun going golfing together", "I've never met anyone who kisses up that much", etc.

In practice you see it applied in very large teams with team wide metrics. Like 1000 people in a call center. The guy who hacks the system or gets assigned to a special team that naturally results in better results, can consistently win every time.

I think it means "far exceeds the expectations at his current role". If you get several FEs, then it's time for a promotion.

Stack ranking is one of those organisational things that so clearly has no value that it bogles my mind that companies adopt it.

Define your metrics based on favoritism, calculate your numeric metrics based on favoritism, implement "difficult management employment decisions" based solely on numbers. Whats not to love?

and managers like it.

because they can reduce their decision making to a spreadsheet.

Something tells me the author started writing this article before the firefox news... (slightly after Napolean's invasion of Russia)

While I can't speak to the intepersonal management practices, this article seems to feed the tech killing stockholder demand for quarterly profits.

The company is doing much better than before, but "not good enough."

Whether the conclusion is correct, this article, despite it's length, doesn't make a case for Mayer not achieving the long term goals so far. (edit: fixed some messed up wording)

How is Yahoo doing better? Mayer has definitely changed a lot, but I'd argue that much of it is for the worse.

Her most prominent changes, stack ranking and acqui-hires, are pretty bad in general (inciting cutthroat competition and burning cash for disloyal employees).

While the article does discuss activist shareholders, it's really a brutal indictment against Mayer's leadership in general. It left me wondering if Mayer stood up the author on a lunch date.

Regardless of Yahoo's recent results, Mayer seems to have alienated many people and made decisions that increasingly seem unlikely to achieve the long-term goals. Really, what has been accomplished?

- She went all-in on playing the app lottery by developing new apps in-house, and I don't think any of Yahoo apps have been real winners. However, she bolstered the app engineering force, which may pay off down the road as the mobile software landscape continues to evolve.

- She bought up a bunch of expensive start-ups seemingly at random. I figured these purchases might make sense in retrospect, when some grand design is revealed, but I'm still waiting.

- She made a big bet on online media that doesn't align with what people want to watch.

Google can afford to throw spaghetti against the wall because Google's search revenue is footing the bill. Yahoo seemingly adopted the same strategy in an attempt to identify its core business.

The Firefox news is going to do more to bring down Mozilla than bootstrap Yahoo. Yahoo's search IS inferior, and forcing it on people is bullshit. Mozilla should allow users to choose their default search provider on installation.

> Mozilla should allow users to choose their default search provider on installation.

That's EXACTLY what they do. The same way the did before. Google was the default and people could easily change it to bing, duck duck go or whatever they wanted.

They still can but the default is Yahoo instead of Google.

Options > Search > Default search engine.

It's really easy.

I'd advice you to CHECK things before spreading this kind of disinformation.

I am 100% certain that when I updated to Firefox latest, my default search engine was changed. Give me just a moment to reconfirm.

Edit: Just confirmed. Installed FF 30. Turned off the option to receive search updates. Updated to latest, provider was still changed to Yahoo.

The default search changes if you have never touched the search option.

It probably changed even if you switched away from Google and back to it at some point.

Firefox checks the pref value, and if it equals the default it considers it a reset and removes it from the prefs override file. There's no way to hard set the equivalent of the default value.

But as mentioned elsewhere, now that the default is Yahoo, changing it to Google should stick forever.

My wife was complaining about that same thing. She was like "What the heck is Yahoo search?!? Is that even a thing?"

mine wasn't changed: it was DDG before, and still is.

I'm glad they added duckduckgo

Firefox has a wizard which tells you how to change it the first time you click in the box. If that isn't a good experience for the search box I don't know what is. They have actually significantly enhanced the UX for how searching works when they switched to Yahoo default on installation. (These enhancements may only be in the nightlies right now)

Forcing? I didn't realise Firefox were hardcoding this in now.

I chose not to receive updates to my search. Mozilla updated my search anyway. That's forcing. It's underhanded.

And now I have sponsored links when I open a new tab in Firefox, from Mozilla partners.

It's starting to stink. The Mozilla foundation is losing sight of their mission.

They are running a donation campaign right now. I hope you donated.

You literally can't type a search query in firefox without it asking you which engine you would like to use.

Unless you click "change search settings" (on that pulldown dialog) and deselect all the other providers.

Honestly, I'm really impressed with the UI of that little search box.

The company is doing much better than before, but "not good enough."

It all comes down to returns. Yahoo might be doing better, but if it's not doing as well as other potential investments, money will flow out of Yahoo into other, more productive companies.

Does the stock exchange price of long issued shares really matter in the success of the company? If the stock price of the company goes down, no money actually exits the company.

You may have an issue in executive retention if bonuses are tied into stock value (but is that really a problem if they collectively didn't deliver value to the company?).

If you're trying to buy other companies it also may limit your options there too.

But in terms of generating revenue, I don't see how the stock price has any direct impact.

> Ask.com, a search engine that no longer innovates but happily takes in $400 million in annual revenue

Holy crap. I must have taken a wrong turn in life. HOW?!

Toolbars and arbitrage.

What arbitrage, exactly?...

They advertise their own search result pages on Google, then sell a bunch of ads at higher CPC on their page, with the idea being that they'll make enough on the commission from the second ad to pay for the Google ad with a profit.

Didn't Google cut that out a long time ago? I didn't find any evidence that Ask was still doing this.

basically malware (ask toolbar)

They have a massive office building in the East Bay, too, every time I passed it I asked myself how in the????

That's actually closer to their quarterly earnings according to IAC's earnings releases (see search and apps) (http://ir.iac.com/results.cfm?Quarter=&Year=2013).

Do people forget that when Jobs came back to apple, he did it with a whole team of people coming in the boat with him, as well as their technology ( Next ) that would become the ground technology for rebuilding the company ???

I'm sorry, but it's not just about one man returning. It's about a team led by one man.

What happened when you tried to select text on the nytimes.com:

* Left-to-right: nothing

* Right-to-left: taken to a new page!

Sweet. I love surprises. (this is on a desktop browser - chromium)

If only I could plug in a second mouse to pinch-to-zoom!


Click on the page icon in your address bar and set JavaScript to "Always block on this site". Also gets rid of their pay-wall ;)

NoScript's kind of a pain to live with, but it's better than this crap.

I don't have these troubles in FF or Chrome (on linux). Any plugins that could be interfering?

I'm on Chriomium Version 37.0.2062.120 Ubuntu 12.04 (281580) (64-bit).

No extensions or plugins are active for nytimes.com. My UA spoofer was off as well.

Can someone explain to me how you value a company turning a $500 million annual profit at -$4billion? I could understand if the company had $6 billion in debt, but it doesn't.

What am I missing about the accounting?

It's a bit of a slight of hand that involves independently valuing each part of the company. Nonetheless, that 55% YoY loss in GAAP income doesn't look too good. There's also the fact that the company has $20bn in current and deferred liabilities and debt, with long-term liabilities up 300% since 2009.

A company can be profitable and still have a negative valuation, specifically if its liabilities outgrow its revenue. Generally, such companies become takeover targets if there's anything worth preserving. (Theoretically, the concept is that equity holders will take a discount on their shares because the company's poor prospects reduce liquidity in trade, and holding onto a share is seen as riskier than taking a lesser haircut now.)

The previous discussion is at https://news.ycombinator.com/item?id=7606891.

Thanks--it wasn't clear to me how Yahoo's liabilities stood. Even without the rest, that would've prevented me from asking my question.

Conglomerates are often worth less than the sum of their parts because profits from successful businesses can be easily transferred to other businesses that are poor investments.

In the case of Yahoo, the market believes that it will destroy a substantial portion of the value of their share of the Alibaba business by making bad investments into core Yahoo.

There's an interesting effect there: if Yahoo doesn't have Alibaba, its core business probably couldn't be valued at a negative level (near zero might be possible, but not negative). I guess that makes sense at some level.

There was a big thread a while back on HN that went into the details. What I got out of it was that the negative price reflects the market view that despite the cash coming into Yahoo, they are more likely to destroy value than create it.

It just means that the share price doesn't reflect the true value of Yahoo.

That doesn't make much sense. The value of anything is what people are willing to pay for it.

In the long term, a company's value is usually considered to be the discounted future cash flows. Stock price is often vaguely, if at all, correlated with this number.

In the long term, a company's value is usually considered to be the discounted future cash flows.

Yes, theoretically it is. However, the value (price) of something is not decided by some formula, it's decided by the market.

Think back to the real estate crash of 2007. Value was dictated by what people would pay, not by some calculation of value.

They owned shares in Alibaba that had a market value of $4b more than Yahoo's market cap, which in theory should have reflected the value of Alibaba plus all the other assets.

I mean, yes, I understand that they're doing that calculation. But it doesn't make sense to me.

Alibaba is good at making money. Yahoo is good at burning them.

If you take $1bn from alibaba -> $1BN goes to shareholders.

If yahoo takes $1bn from alibaba -> they pay a hundred million for a golden parachute, stagnate tumblr with the other 500$, buy startups for $499 million and return some loose change and pocket lint to investors.

You may be thinking that stock prices always make sense. :-)

It's not about accounting. Market value reflects future cash flow expectations adjusted for risk.

"Generally speaking, there are only a few ways to make money on the Internet."

And the article goes on claiming that e-commerce and marketplaces, hardware, and ads are those few ways.

This can't be true considering how much money Netflix (subscription), AWS (metered pay), mobile games (IAP) are making.

Agreed. This article starts with a hypothesis ("Marissa Mayer bad!"), and then lays out cherry-picked 'facts' and anecdotes around it.

It could as easily have started with "Marissa Mayer great!", and done the same (but with a different set of 'facts' and anecdotes).

The thrust of his article was not about this, but these are good points.

The three ways of making money -- transaction fee, selling hardware, and selling ads -- exclude just paying for an internet service (where I would call subscription, metered, and IAP different ways for paying for a service).

You could call that a subset of e-commerce except that he defines e-commerce companies as those that "that profit from transactions occurring on their platforms," and uses Amazon, ebay and Uber as examples.

They did say generally.

Also, they were presumably only talking about consumer web services. AWS doesn't fall into that category.

"But in Silicon Valley, the big money, and most of the prestige, is in making cool products. This is partly because product businesses, based on technology, are easier to scale than content ones, which require more human labor. It also reflects a cultural bias. The Valley’s greatest companies, from Hewlett-Packard onward, have been built around technological ingenuity. Tech executives know how to hire engineers and designers; they’re less adroit at recruiting editors or producers. When Loeb joined the Yahoo board, he recruited Michael J. Wolf, the former president of MTV, and the two consulted the noted venture capitalist Marc Andreessen about who should become the next C.E.O. of Yahoo. Andreessen made the case for a product executive."

This seems to be missing part of the story. Didn't Yahoo! previously try hard to reinvent itself as primarily a "content" business under a CEO recruited from Hollywood, Terry Semel? IIRC it was Yahoo! failure to thrive using that strategy that got it into (relative) trouble in the first place.

“Like an actual hundred,” Mayer responded, “or like 60 rounded up to 100 to make me feel better?” The department responded that it was more like 60.

Being a CEO is often a job of pulling teeth.

Only if you have unreliable direct reports or you comport yourself in such a way that people feel obligated to "shape the truth."

I'm guessing it's the second of these two for Marissa.

If Marissa hired me, I'd tell her, "Throw away everything and focus your team 100% on search." Search is her core competency -- so stop pretending to be a media mogul and get down to what you know best. Web search is far from done, and it has loads of potential. It's her "iPod."

How ironic would it be Yahoo displaced Google, because Google had lost their focus on doing one thing (search) and doing it really well?

Funny, I got the opposite impression. I would tell her "Throw away everything and focus 100% on mid- to low-brow content." More celebrity blogs, fantasy sports, etc. Yahoo has a lot of unsophisticated eyeballs, but they're not a tech leader.

I don't know, that seems like fighting the last war ("Generals always fight the last war"...)

Microsoft has a 5 year head start and has spent billions on this and they are nowhere close to Google (I'm not even talking tech, just market share).

I think the only way to beat Google at this point is by winning the next war (Yahoo! already missed mobile). Just like no one beat Microsoft at operating systems or productivity software; the world just moved on from caring about those things. Of course, no one knows what the next battle will be.

Of course, beating Google is somewhat of a red herring; they don't necessarily need to lose for Yahoo! to win.

I thought they dropped search years ago. Nowadays their search is powered by Bing?

It is. But that doesn't mean they can't rebuild it (it will NOT be easy, but they have the $$$ to splurge on a talented team)

Yahoo has never been about search! They've always been a portal. They're a content company. A tabloid. They should focus on that first, services like Mail, Pipes, BOSS etc second.

A very scathing article. Anyone who has interacted with Marissa have any inside information? Be interested to hear about what she has done well.

The story is told from a very critical angle and I wonder if there are another less the-sky-is-falling side.

On the other hand, I did not think yahoo.com got better (yes i am a frequent user): - Yahoo mail actually got worse. 2 Years ago the UI looked bad and straight out of 1990s, but at least it worked reliably and efficiently as a junk email address. In the 2 year since it got a modern makeover and looked better but still very yahoo-y and not good. However the UX design became more complex and more of a hassle to use. Meanwhile the speed and performance has really gone down, presumably due all the Javascript involved in the make over. The worst problem is mail outage. Login issues and mail outage started to happen much more frequently. It was a stable product at least, now it's just bad. I stopped using that address.

-Many changes has been made to Yahoo home pages but one would be hard pressed to find users that unequivocally liked the changes. It is still churning more of the low quality, info lacking and grammar error strewn articles. The only fun(if you are that bored) is in the comment section.

Lastly one has to wonder about her frequent tardiness. I am all for gender equality in the workplace but one has to wonder that trying to turn a massive company around as its CEO during and immediately after pregnancy is a good idea.

Mail is absolutely awful.

They've redesigned the Yahoo Finance homepage but they've really trashed it. Recent quotes rarely works, the page is cluttered, they constantly link to articles that start auto playing some obnoxious video. Their financial data is good though and the stock quote pages haven't changed much so the internals are OK. There's a stuff they could do to improve it, but given their track record, I hope they don't try.

The irony is that Yahoo! Finance's users presumably have money since they're looking for investment news, so you'd think that those ads would be especially lucrative.

One thing I do like is that they have several financial writers on tumblr now and they link to that content from the Finance home page. Those tumblrs are actually some of the best content on Finance.

> Lastly one has to wonder about her frequent tardiness. I am all for gender equality in the workplace but one has to wonder that trying to turn a massive company around as its CEO during and immediately after pregnancy is a good idea.

Didn't she have an in-office nanny taking care of everything? It's more likely she's losing her mind from that 4 hours of sleep.

Of course, that is one great reason to take maternity/paternity leave.

There are few good changes from Yahoo lately. For example, Flickr is now giving 1TB space. The team seem to write cool technical things on their blog. Yahoo Mail Plus version is essentially free now. It was refreshing to see so many new iOS apps from Yahoo but I haven't used them so don't know their usefulness. Before Mayer, there was hardly anything at all coming out from Yahoo.

Yeah, while I agree with many of the points made in the article, I wondered why the article has such a one-sided narrative and brutally critical tone. Do the activist investors have enough power to get this piece pushed forward?

This is a nice article, that clearly demonstrates the great value that hedge fund managers contributed to humanity along the years

> One of the Yahoo board’s hesitations upon hiring Mayer was her relative lack of experience as a manager.

Something executives seem to not be able to understand: Experience counts.

Its one thing to ride the wave of success when you are in at the beginning. Its something entirely more difficult to right a large, floundering ship when you have never actually been captain.

"A week later, Smith published an open letter calling for Yahoo to...merge with AOL. Redundancies could be eliminated, thousands of people could be fired and two former Internet superpowers would be downsized into a single and steady (if uninspiring) entity...'We trust the board and management will do the right thing for shareholders, even if this may mean accepting AOL as the surviving entity'"

I see where Smith is coming from, but that doesn't make his case any less unsettling. Do some economists really believe that the "right" thing to do is fire thousands of people?

Are a company's shareholders really more important than its employees?

> Do some economists really believe that the "right" thing to do is fire thousands of people?

Yes. The idea is that they'd be more productive in other companies (or start their own). In a country with decent employee protections, unemployment provisions, and public healthcare, it can even be more-or-less true.

> Are a company's shareholders really more important than its employees?

Yes. With employees, there is a contract, which in some fictional-economics sense was a negotiated agreement between equals, so the company only has those obligations laid out in that contract (just as with bondholders). With shareholders there is no contract, instead the company has a fiduciary duty to act in their best interests.

I take it you don't agree with the story you mention from your tone, so I'm not arguing with you.

However, as the concept of work to rule (http://en.wikipedia.org/wiki/Work-to-rule) shows, employees don't treat themselves as being only obligated to do what their contracts specify, and it would be disastrous if they did. Similarly, managers view themselves as owing something to their employees that's not specified in the contract.

Hostile takeovers often work by going into a company and breaking all the relationships of trust that previously existed. By doing that, you can often cut costs in ways that the previous management couldn't do. (Here's the paper, though I confess I've only read the summaries of it: http://www.nber.org/chapters/c2052.pdf)

Fewer and fewer people believe this myth nowadays as opposed to 10-15 years ago.


Jack Welsh never did believe it.


No. A company's most important duty is to its customers; without them there is no income or profit. Its second most important duty is to its employees; without them there are no products or services to sell to the customers. Coming in third are the stockholders; the parasites who risk a bit of capital in order to profit from people who actually produce things.

"Are a company's shareholders really more important than its employees?"

Shareholders in this sense actually represent financial responsibility.

One could argue that Yahoo! has been hurting it's employees by failing it's shareholders (financial obligations). As a result, massive layoffs will be required, whereas if Yahoo! had maintained it's health, it's numbers would have grown/shrank organically.

In this sense, the Alibaba money only delayed, and made worse the correction to Yahoo!'s underlying business model.

While I can't answer your question(s), I do wonder why Yahoo and AOL fill me with no feeling whatsoever. This, for as long as I can remember (save a few select years in the mid 90s). It's amazing how these companies can still be around, though I understand "Middle America" still uses them.

Yahoo sports is really good, for example. It's not a bad aggregator in general and has good original content mixed in.

I don't understand the synergy with AOL at all. What does AOL bring to the table?

This may seem odd, but if I knew I could make a soft-landing (live on savings or benefit for a while) I'd be fine with getting let go. I now live in a country where people can do this and it stuns me that I don't see more entrepreneurship; if I could spend 6 months living in a meager fashion but sure of a roof over my head I'd take it in an instant to work on starting my own thing. I can't though (I used to live in the US where it's too easy to wind up in the gutter, and where I live now I'm not a citizen), so I value my job very highly.

I don't understand your sentiment here. If there is a large overlap and both companies are struggling (and struggling is dying when you're an Internet company), why not eradicate inefficiencies and try and build a stronger player?

AOL and Yahoo are not beholden to provide for their employees in perpetuity. That's a very Japanese mindset.

"Steve Jobs"-type people are rare. Marissa Mayer I'm sure has her strengths, but this comparison is unnecessary or perhaps, unfair.

This 1996 Microsoft Developer's Conference is one of my favorite Steve Jobs presentations http://channel9.msdn.com/Events/PDC/PDC-1996/PDC-1996-Keynot...

According to the article, she's the one who keeps making the comparison.

The difference is that Jobs was an asshole, everything I've ever heard about Mayer is that she's probably a psychopath.

My guess is that she was able to cover it up well at Google by burying everybody in data-driven decision making processes and working hard. But a data-driven decision making process about creative stuff is precisely the kind of approach an emotionally disconnected person would use as a tool to do their job.

She was a long-shot try for CEO and has done some good things. But it may be time for her to move on. My sympathies for whatever group ends up with her in charge next.

>The difference is that Jobs was an asshole, everything I've ever heard about Mayer is that she's probably a psychopath.

Replying to an email with a smiley emoticon because you ruined someone's career when all the person did was exactly what their fucking job expects them to do is kind of a psychopathic thing to do.

Also, starting and running a wage-fixing ring that inflicts the most damage upon those upon which you rely the most to make you wealthy is also kind of a psychopathic thing to do.

You're quite right. Steve Jobs was both an asshole and a psychopath. Still, he was one hell of a visionary.

Just a quick glance at the way she has butchered the sports section of the website should be enough to condemn her. It went from being the best on the net to being too complicated, full of mistakes and unreadable. It forced me to go to ESPN (which I also don't like). You don't make changes just to make changes. Without a clear sense of purpose and clear vision of what you're doing and who you're aiming at, a CEO is a failure.

Notwithstanding Meyer's faults or idiosyncracies, I wonder if there was anything anyone could have done to reinvigorate Yahoo?

They should have built youtube competitor in house rather than looking at dailymotion. Given yahoo user base and talented developers, it should have reached respectable market share and ad revenue.

The counter-Mayer argument is that Yahoo! should have focused on "media" and ad sales, two of their strengths and then maybe "dabbled" with enhancing their products.

This theory of course cannot be proven, however the closest evidence we may have is AOL.


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